Armenia Country Brief

Introduction/overview

Armenia is a land-locked country located in south-western Asia, bordering Georgia to the north, Turkey to the west, Iran and Azerbaijan to the south and east. The country's total land area is roughly 30,000 square kilometres, and its population at end 2006 was estimated to be 3.2 million. The capital of Armenia is the city of Yerevan.

Armenia's national day is celebrated on 21 September.

Political Overview

The Republic of Armenia became independent on 23 September 1991, following a national referendum establishing independence from the former USSR. It is a Presidential Republic led by President Robert Kocharian who was elected by popular vote in 1998, and reelected in March 2003. The next Presidential elections are due in February 2008.

The executive branch of the government includes a council of ministers appointed by the Prime Minister, the members of which serve five-year terms. The Prime Minister is currently Mr Serzh Sarkisian.

The Armenian Parliament is a unicameral system with a National Assembly (Azgayin Zhoghov) in which members serve four-year terms.The last Parliamentary elections were held in May 2007 and election monitors from Europe and the United States judged the process to be largely democratic.The current government, appointed in June 2007, is a coalition between the Republican Party of Armenia and Prosperous Armenia; the Armenian Revolutionary Federation has signed a power-sharing agreement with the coalition government, and holds several ministerial portfolios.

As a newly independent state, Armenia is making modest, but steady progress with its efforts to integrate into the international community. In 1992, it became part of the Commonwealth of Independent States (CIS); joined the European Bank for Reconstruction and Development (EBRD); was admitted to the Organisation for Security and Cooperation in Europe (OSCE); and became a member of the United Nations. On 5 February 2003, Armenia achieved full membership of the World Trade Organisation. Armenia is also a member of the International Monetary Fund, the World Bank, the Council of Europe and NATO's Partnership for Peace.

Economic overview

In 2007, Armenia is estimated to achieve an 11.1 per cent growth in real GDP, falling from 13.3 per cent in 2006. Exceptionally high growth rates between 2001 and 2005 have been driven largely by grant-funded construction and manufacturing projects, including extensive road and housing reconstruction following the devastating 1988 earthquake.

Construction remains the dominant sector in Armenia’s economy, contributing 25 per cent to total GDP in 2006 (source: Economist Intelligence Unit). However, the Economist Intelligence Unit expects GDP growth to continue to fall over the next two years and estimates Armenia’s current account deficit will grow to 2.5 per cent of GDP for 2007.

Bilateral relationship

Australia recognised Armenia on 26 December 1991 and established diplomatic relations on 15 January 1992.

Migrants of Armenian ancestry have come to Australia from a number of countries other than Armenia itself, such as Egypt, Lebanon, Syria, Jordan, Israel, Turkey and India. Migration to Australia began in the second half of the nineteenth century. The peak period of migration occurred a century later in the 1960s, with numbers growing steadily. Today, the community includes people born in 43 different countries. The 2006 census recorded almost 16,000 people in Australia who claim Armenian ancestry.

Australia’s Ambassador to Moscow is accredited to Yerevan. There is no Armenian Government representation in Australia.

Governmental visits are increasing although they are still modest. The then Minister for Human Services, the Hon Mr Joe Hockey MP, visited Armenia in November 2005, and the Hon Joel Fitzgibbon MP visited in 2006. The then Australian Minister for Immigration and Multicultural and Indigenous Affairs, the Hon Philip Ruddock MP, visited Armenia in September 2003. In October 2005, the Armenian Foreign Minister, H.E. Mr Vartan Oskanian, visited Australia.

Bilateral economic and trade relationship

Geographic distance and restricted trade routes to Armenia limit the prospects for flourishing two-way trade between Australia and Armenia. In the financial year 2006-2007 total merchandise trade was worth approximately A$5 million, half the 2005-06 figure. Australian exports to Armenia were worth around A$3.8 million (mostly specialised machinery and butter). Imports from Armenia were worth A$230,000 and mostly consisted of footwear.

The Armenian economy’s relatively small size and uneven rate of development has limited bilateral trade prospects to date. However, in recent years, Austrade has supported a small number of Australian companies that are successfully doing business in the country, notably as suppliers of technology, equipment and raw materials in the resources sector and withinArmenia's grape-growing industry (grapes are used for Armenia's famous cognac and for local wine production).

Opportunities also exist in construction, with Yerevan experiencing a surge in building.